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British Virgin Islands (BVI)

The world’s leading offshore for crypto, Web3 and venture structures

The British Virgin Islands (BVI) have become the preferred jurisdiction for blockchain projects, token issuers and venture funds that need a stable, tax-free and internationally recognized base. BVI companies combine simplicity of setup with credibility grounded in English common law.

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Why BVI?

Table of contents
  • Why Choose BVI?
  • Tax Benefits and Fast Incorporation
  • Annual Compliance and Regulatory Oversight
  • Predictable Legal System and Global Recognition
1.

Why Choose BVI?

Due to registration easiness, corporate flexibility, 0% incomes tax and owners’ anonymity, BVI companies are widely used for cutting-edge technology companies, software developers, startup studios, token-friendly startups and investment structures.

2.

Tax Benefits and Fast Incorporation

There are no corporate income, capital gains or withholding taxes, and no requirements for audits or local directors. A company can be incorporated in around two weeks with one director and one shareholder, who may be individuals or corporate entities.

3.

Annual Compliance and Regulatory Oversight

Annual compliance is largely limited to filing an economic substance declaration and keeping basic accounting records. The BVI Financial Services Commission (FSC) supervises financial and virtual asset activities, including licensing of Virtual Asset Service Providers (VASPs). The FSC’s evolving framework gives legitimate crypto ventures a compliant environment without excessive bureaucracy.

4.

Predictable Legal System and Global Recognition

The BVI’s legal system is rooted in English common law, offering predictable dispute resolution and trusted standards recognized by investors and financial institutions worldwide. This makes the BVI an ideal jurisdiction for token issuers, DAOs, venture funds, and holding companies seeking global recognition with minimal friction.

Set up your hedge / venture fund on BVI

The British Virgin Islands offer several fund structures designed for different types of investors and investment goals. The most popular types of BVI funds include:

Table of contents
  • Incubator Fund
  • Approved Fund
  • Private Fund
  • Professional Fund
  • Public Fund
  • Private Investment Fund (Closed-Ended)
1.

Incubator Fund

The fund is aimed at new managers who want to test an investment strategy before scaling up. It can have up to 20 investors and a maximum of $20 million in assets under management. It can operate for two years, with the option to extend for one more. It has light reporting requirements and does not need to be audited during that period.

2.

Approved Fund

A relatively straightforward, low-cost structure for smaller investment pools. It is capped at 20 investors and USD 100 million in assets. An administrator must be appointed, but there is no need for a custodian or auditor unless required by investors. This type of fund suits early-stage ventures, “friends and family” funds, and small crypto or venture vehicles.

3.

Private Fund

A Private Fund can have up to 50 investors or be offered strictly on a private basis. There is no minimum investment amount, but the fund must prepare audited annual financial statements. It is often used by small to mid-size groups of professional investors pooling capital for digital assets or venture deals.

4.

Professional Fund

The Professional Fund is the most common type of open-ended fund in the BVI. It is open only to professional investors—people with a net worth above USD 1 million or whose business involves managing investments. The minimum investment is USD 100,000, and there is no limit on the number of investors or fund size. An annual audit is mandatory. This is the preferred structure for established hedge, venture, and crypto funds.

5.

Public Fund

A Public Fund is a fully regulated retail fund that can be marketed to the public without limits on investor numbers. It comes with the highest level of disclosure and regulatory oversight. Because of this, it is rarely used for crypto or early-stage projects but works well for large-scale or diversified retail investment products.

6.

Private Investment Fund (Closed-Ended)

The Private Investment Fund, or PIF, is used for closed-ended strategies such as private equity, real estate, or tokenised assets. It can have up to 50 investors or be offered privately. Investors cannot freely redeem their interests, and an annual audit is required. This type is well suited for Web3 projects investing in illiquid assets or long-term ventures.

BVI in a nutshell

Tax neutrality

0% tax on income, capital gains and dividends.

Fast incorporation

Fast formation (around two-three weeks depending on compliance checks).

Simple corporate structure

At least one director and one shareholder is required (could be the same person).

No local burden

No audit or local presence required.

English common law system

Commonwealth common law jurisdiction with English-like law and court system.

Light ongoing compliance

Economic substance declaration once per year.

Crypto regulatory framework

VASP regime for compliant crypto operations.

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FAQ

Why is the British Virgin Islands a popular offshore jurisdiction?

The British Virgin Islands are widely used by crypto, Web3 and venture projects due to tax neutrality, corporate flexibility and international recognition. BVI companies combine simple setup with legal credibility based on English common law.

Who typically uses BVI companies?

BVI companies are commonly used by blockchain projects, token issuers, software developers, startup studios, venture funds, DAOs and holding companies that require a stable and globally recognised offshore base.

What are the tax features of a BVI company?

The BVI imposes no corporate income tax, capital gains tax or withholding tax. This tax-neutral environment makes the jurisdiction attractive for international business and investment structures.

How fast can a BVI company be incorporated?

A BVI company can typically be incorporated in around two weeks, subject to compliance checks. Only one director and one shareholder are required, and they may be the same person or corporate entities.

Are local directors, audits or physical presence required?

No local directors or physical presence are required. Annual compliance is generally limited to maintaining basic accounting records and filing an economic substance declaration. Audits are not required for standard companies.

How is crypto and virtual asset activity regulated in the BVI?

The BVI Financial Services Commission supervises financial and virtual asset activities, including licensing of Virtual Asset Service Providers. The VASP framework provides a compliant environment for legitimate crypto ventures without excessive bureaucracy.

What legal system governs BVI companies?

The BVI legal system is based on English common law. This provides predictable dispute resolution and standards that are widely recognised by investors and financial institutions.

Why is BVI suitable for token issuers and DAOs?

The combination of tax neutrality, corporate flexibility, English-based legal standards and a supervised VASP regime makes the BVI well suited for token issuers, DAOs and Web3 projects seeking global recognition with minimal friction.

What types of investment funds can be set up in the BVI?

The BVI offers several regulated fund structures, including Incubator Funds, Approved Funds, Private Funds, Professional Funds, Public Funds and Private Investment Funds (closed-ended), each designed for different investor profiles and investment strategies.

What is a BVI Incubator Fund?

An Incubator Fund is designed for new managers testing an investment strategy. It allows up to 20 investors and USD 20 million in assets, operates for up to two years with a possible extension and does not require an audit during that period.

What is a BVI Approved Fund?

An Approved Fund is a low-cost structure for smaller investment pools, capped at 20 investors and USD 100 million in assets. It requires an administrator but no custodian or auditor unless investors require one.

What is a BVI Private Fund?

A Private Fund may have up to 50 investors or be offered strictly on a private basis. It must prepare audited annual financial statements and is commonly used for pooled digital asset or venture investments.

What is a BVI Professional Fund?

A Professional Fund is open only to professional investors with a minimum investment of USD 100,000. There is no limit on fund size or investor numbers, and an annual audit is mandatory. It is the most common structure for established hedge, venture and crypto funds.

What is a BVI Private Investment Fund (PIF)?

A Private Investment Fund is a closed-ended structure used for illiquid strategies such as private equity, real estate or tokenised assets. It can have up to 50 investors or be offered privately and requires an annual audit.

What makes the BVI attractive in summary?

The BVI offers zero taxation on income and capital gains, fast incorporation, minimal compliance, English common law, an annual economic substance declaration and a regulated VASP regime for compliant crypto operations.